Borrowers’ repayment capacity took a hit in Q3 FY21, Infomerics report says
Default rates or default rates began to rise from the first quarter of FY21 amid the pandemic, according to an Infomerics report.
“The magnitude was more in the ’30-59 days late’ category where the delinquency rate rose to 4.73 percent until Q3FY21. This delinquency fell to 2.90% by the end of the year. fiscal year 21, but soared to 10.52% in the devastating second wave, “Infomerics said in its industry outlook on MFIs. He further noted that the delinquency rate had also increased in the” 60- 89 days late âandâ 90-179 days late â.
Meanwhile, the Indian microfinance industry’s loan portfolio stood at over Rs 2.37 crore, serving 5.68 crore of single borrowers with loan accounts of 10.3 crore. This report highlights that the results of T2FY21 show a reduction in the size of the MFI industry compared to T1FY21. The gross loan portfolio as of June 30, 2021 showed an increase of around 4.2% year-on-year from Rs 2.27 lakh crore as of June 30, 2020.
Banks held the largest share of the MFI portfolio with a total outstanding loan of Rs 1.02 lakh crore, or about 43.14% of the total micro-credit universe as of June 30, 2021. Closely following, NBFC-IMF were the second largest micro-credit providers with an outstanding balance of Rs 75,021 crore representing 31.61 percent of the industry’s total portfolio, according to the rating agency.
SFBs had a total outstanding amount worth Rs 38,624 crore with a total share of 16.27 percent, while NBFCs accounted for 7.89 percent and other MFIs 1.09 percent. The rating agency says Tamil Nadu has the largest state in terms of current portfolio at Rs 35,312 crore, followed by West Bengal at Rs 34,587 crore and Bihar at Rs 26,997 crore respectively. West Bengal had the highest average loan per single borrower of Rs 54,159, followed by Assam at Rs 48,697 among the top 10 states.
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